What is a lease option?

A lease option is fundamentally a rental agreement that provides the tenant with the opportunity to purchase the property at a later date. This arrangement typically gives the tenant the right, but not the obligation, to buy the property during or at the end of the lease term. The agreement usually specifies the purchase price or outlines a method for determining the price. This structure can appeal to tenants who are interested in homeownership but may not be ready to buy immediately, allowing them to secure their future purchase while living in the property.

While the second choice refers to a lease that includes a rent-to-own clause, it is more specific and may differ in terms and conditions compared to a lease option. The other options focus on temporary agreements or long-term contracts without any potential for purchase, which do not align with the idea of a lease option that specifically involves a future purchase right. Therefore, the essence of a lease option lies in the tenant's ability to later acquire the property, making the first choice the most accurate description.